Q1FY23 Preview: Bajaj Auto: Revenue seen at Rs77,237 million, PAT at Rs11,433 million

25 Jul 2022 , 10:48 AM

Result date: 26^th July, 2022
Recommendation: Add
Target price: Rs3,860
 
Sales volume of Bajaj Auto fell by 7% over the year-ago quarter and 4% sequentially during the June 2022 quarter. This decline is largely on account of chip shortage which has impacted sales of premium motorcycles and three wheelers. Export markets are also witnessing some pressure. The company’s revenue could grow 4% over the year-ago quarter and decline 3.1% on a sequential basis.

EBITDA margin is estimated at 16.5%, up 93 basis points over the year-ago quarter, but down 59 basis points sequentially. Price hikes and favorable currency benefit on exports are key margin tailwinds, while rising input costs and negative operating leverage are prominent pressure points.

Profit After Tax (PAT) could reflect weakness in operating performance on a sequential basis.

Important management insights to watch out for:

• Demand trends across rural and urban markets
• Commentary on availability of chips
• Outlook on input costs, price hikes and margins

Rs. Million	June 2022 estimates	YoY change	QoQ change
Volumes	933,646	(7.2)%	(4.4)%
Revenue	77,237	4.0%	(3.1)%
EBITDA	12,768	10.3%	(6.5)%
Profit After Tax	11,433	4.9%	(7.2)%

Source: IIFL Research